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Question 114

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Use the information below to answer the following questions.
Fact 12.2.1 Chevy Volt Production Temporarily Shut Down
GM will temporarily lay off 1,300 employees as the company stops production of the electric car, Chevy Volt, for five weeks. GM had hoped to sell 10,000 Volts last year, but ended up selling just 7,671. It plans to maintain inventory levels by adjusting production to match demand.
Source: Politico, March 2, 2012
-Refer to Fact 12.2.1. The shutdown decision ________ total fixed cost and ________ total variable cost.


A) decreases; decreases
B) does not change; decreases
C) does not change; does not change
D) increases; does not change
E) does not change; increases

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